Jan. 15 (Bloomberg) -- The yen rose the most since May
versus the dollar as Japanese Economy Minister Akira Amari said
an excessively weak currency may hurt imports and households,
damping bets policy makers will try to push it down further.

Japan’s currency gained for the first time in five days
against the dollar on bets its drop to the weakest level since
June 2010 was excessive. The Swiss franc slid to a 13-month low
versus the euro as signs Europe’s debt crisis is easing cut
demand for the currency as a haven. South Africa’s rand fell
after Anglo American Platinum Ltd. said it will cut output.

“Amari’s comments introduced the possibility that the
government may be a bit concerned about the pace of the decline
of the yen,” Brian Daingerfield, a currency strategist at Royal
Bank of Scotland Group Plc’s RBS Securities unit in Stamford,
Connecticut. “A signal coming from Japanese officials that
maybe the yen is weakening too quickly is something that might
give the market a bit of pause.”

The yen climbed 0.9 percent to 88.65 per dollar at 12:58
p.m. in New York and rallied as much as 1.3 percent, the biggest
intraday jump since May 17. It slid to 89.67 yesterday, the
weakest level since June 25, 2010. Japan’s currency gained 1.3
percent to 118.23 per euro. The dollar advanced 0.3 percent to
$1.3336 per euro.

Norway’s krone and South Africa’s rand were the biggest
losers among the greenback’s 16 most-traded counterparts.

Rate Decision

The krone fell after central bank Deputy Governor Jan F.
Qvigstad signaled a persistent strength in the currency would
influence the bank’s next rate decision in March. It declined
1.2 percent to 5.5682 per dollar.

The rand weakened after Anglo American Platinum said it
will shut four shafts, putting 14,000 jobs at risk and fueling
concern South Africa’s current-account deficit will widen. The
currency dropped 1.4 percent to 8.8144 per dollar and touched
8.8242, the lowest since Dec. 4. Metals and other minerals
accounted for 61 percent of South Africa’s exports in the first
11 months of 2012, according to government data.

The Swiss franc depreciated past 1.24 per euro for the
first time since Dec. 7, 2011, as haven demand ebbed. European
Central Bank President Mario Draghi said Jan. 10 the euro-area
economy will slowly return to health in 2013. The currency fell
0.4 percent to 1.2389 per euro and reached 1.2413.

Premium Climbs

The premium for three-month options granting the right to
sell the franc versus the euro relative to those allowing for
purchases surged to the most since at least 2003, as far back as
Bloomberg tracks the data. The so-called risk reversal rate rose
to as much as a 2.12 percentage-point premium for franc puts,
from 1.78 yesterday and 0.87 a month ago. A put option gives the
right, but not the obligation, to sell a currency.

The yen snapped a four-day losing streak, the longest since
November.

“The market is massively short yen because investors are
convinced it will weaken further on the back of the government’s
policy,” said Michael Derks, chief strategist at FxPro
Financial Services Ltd. in London. “When positions are that
extreme, a comment like that from Amari can really swing the
market.” A short position is a bet an asset will decline.

The difference in the number of wagers by hedge funds and
other large speculators on a decline in the yen versus those on
a gain, known as net shorts, was 74,096 on Jan. 8, figures from
the Washington-based Commodity Futures Trading Commission show.
Net shorts totaled 30,447 on Nov. 16.

Campaign’s Limits

Amari said Japan faces risks from any decline too far in
the yen, highlighting the limits on Prime Minister Shinzo Abe’s
campaign to drive down the currency.

“If the yen excessively weakens, this would cause a spike
in import prices,” even as it helps exporters, Amari told
reporters in Tokyo.

The Bank of Japan will review its 1 percent inflation goal
at its policy meeting on Jan. 21-22. Abe has called for the
target to be doubled.

Goldman Sachs Asset Management Chairman Jim O’Neill said
the Bank of Japan must show it’s serious about inflation
targeting for the yen to weaken further.

“Classical indicators suggest it is oversold,” O’Neill
said in an interview on “Bloomberg Surveillance” from London.
The BOJ “has got to show its going to take this 2 percent
inflation target seriously. Rather than just a goal, it has to
be a target,” he said.

The yen slid 16 percent over the past six months, the most
among the 10 developed-market currencies tracked by Bloomberg
Correlation Weighted Indexes, as Abe was swept to power. The
dollar fell 4.7 percent, and the euro rose 4.7 percent.

Debt Ceiling

The dollar rose versus most major peers as investors sought
safety amid bets a political showdown over the U.S. debt limit
will hurt the economy. The limit was reached Dec. 31, and
Treasury Secretary Timothy F. Geithner said yesterday measures
he’s taking to avoid breaching it won’t work past each March.

Geithner warned of severe economic hardship should Congress
fail to raise the ceiling, which lawmakers have increased or
revised 79 times since 1960. President Barack Obama told
Republicans in Congress not to use the need for an increase in
the $16.4 trillion limit to force through new spending cuts.

Fitch ratings said today a failure of U.S. lawmakers to
raise the debt ceiling would prompt a “formal review” of the
U.S.’s AAA credit rating.